Abstract content

Limiting global warming to below 2°C above pre-industrial levels will require sustained and important efforts to reduce anthropogenic emissions of greenhouse gas emissions and to enhance and maintain sinks of carbon dioxide in the land-use sector. Fossil fuel CO2 emissions have continued to grow at an average rate of 2.5% per year over the past decade. Even at today’s annual emission levels, the cumulative CO2 emission quota in line with staying below 2°C would be exhausted in less than 30 years. We will examine how pledges of largest emitting countries to reduce emissions, or maintain sinks in the land-use sector are consistent with a trajectory enabling not to breach the international agreed 2°C temperature limit. In particular, we examine how forest carbon sinks in the US, Canada, Russia, China and the EU, as well as reduced deforestation in tropical countries, can help efforts to attenuate near-term climate change. A specific attention will also be given to the contribution of nations to historical radiative forcing and climate change, including long-lived greenhouse gases and short-lived forcers such as CH4 and aerosols, of which the latter can have a climate cooling or warming effect.

Assessment of intended nationally determined contributions to a 2015 international climate agreement

Abstract content

One of the most fundamental questions in the preparation of a new international climate agreement is whether countries’ proposals to reduce greenhouse gas emissions after 2020 are equally ambitious compared to their peers. Methodologies to rate countries’ climate action often rate different things and therefore come to different conclusions (Surminski and Williamson, 2014).

From the variety of methods that have been applied in the past to rate the ambition of countries climate action proposals, we distinguish two main strands, which are described here as black and white for illustration, acknowledging that they overlap in practice. Both relate to the principle of common but differentiated responsibilities and respective capabilities:

Moral obligation: From this viewpoint, countries have a moral obligation to reduce their emissions. This moral obligation can be measured in a simple way, e.g. for developed countries as the sustained emission reduction effort since 1990 (a commonly used base year) or more sophisticated using a variety of equity principles, so called “effort sharing” calculations (including the IPCC AR5 equity database (Clarke et al., 2014; Höhne et al., 2014)). This strand relates to the “differentiated” element of the agreed principle.

Technical necessity: The starting point of this viewpoint is whether the proposal is in line with what is technically necessary from now on, irrespective of the moral obligation. This could be judged by whether the countries’ proposal is in line with its contribution in globally cost effective model pathways (according to scenarios such as those included in the IPCC AR5 scenario database (Clarke et al., 2014) and model comparison studies, like LIMITS (Tavoni et al., 2015)), leverages all mitigation potential, or covers all policies that the country’s peers undertake. This strand relates more the “common” element of the agreed principle.

The two strands may lead to fundamentally different outcomes. A developing country for example may have limited moral obligation, but significantly more mitigation potential, as developing countries are characterized by higher energy and carbon intensities, have rapidly rising baseline emissions and a high share of new infrastructure (Clarke et al., 2014). For a developed country it may be the other way around, it may have a very high moral obligation, but may have technical difficulty to reduce domestic emissions in the same order of magnitude without retiring old infrastructure before the end of its life (“carbon lock in” or “stranded assets”).

The methods are applied illustratively to the recent post-2020 climate proposals by the USA, China and the EU. The results differ substantially per method, which confirms that a comprehensive ambition assessment is necessary to provide the full picture.

Abstract details

Integrating development and climate policy in South Africa

Abstract content

South Africa’s approach to its INDC will very likely be framed by development and climate. The formal process of consultation by government has yet to take place, but we know that the National Development Plan (NDP) is as important as South Africa’s climate policy. Some research we have undertaken at the Energy Research Centre (ERC) illustrates the challenges of seeking a substantial reduction in poverty, inequality and emissions.

The key question facing the mitigation community in South Africa is the pace with which the country can decarbonize the energy sector, which currently accounts for majority of total emissions, without undermining development imperatives - the NDP places reduction of poverty and inequality at the top of a list of multiple priorities.

The current structure of the South African economy has resulted in sub-optimal environmental (high carbon intensity) and social (high Gini-coefficient and low HDI) outcomes. High levels of poverty and inequality are likely to be exacerbated substantially by climate change impacts in the future, while a reliance on energy- and capital-intensive, and low-labour-absorbing sectors means that even with a sophisticated tax and redistribution system, there are simply too few employed and skilled citizens in the economy to drive improvements in living standards and key socio-economic indicators for majority of the population. Inclusive growth is a necessary condition for attaining better socio-economic outcomes in the future, but the type of growth that South Africa has experienced in the past few decades has not been sufficient.

A key question then is the extent to which a structural change in the economy can meet both mitigation and development objectives. Growth in sectors that are labour-intensive, absorb low- and un-skilled workers and are low carbon need to be incentivized if South Africa is going to move forward with climate compatible growth and development.

The domestic policy system is characterized, however, by lock-in and path dependency. While consultations on the INDC are ongoing, ERC research suggests that what is crucial is an understanding of how a just transition over the next decades from an inequitable and carbon intensive economy to a more equitable and low carbon economy can be achieved. South Africa’s national climate policy, as indicated in 2009, is that its emissions will follow a ‘peak, plateau and decline’ trajectory to 2050. The NDP includes an environmental chapter that talks to “an equitable transition to a low-carbon economy”, yet this remains to be fully integrated with chapters on economy, employment and infrastructure. ERC research has provided initial analysis on what would be required, either with a more skilled work force or possibly a different structure of the economy, to move toward a successful integration of development and climate policy.

The economic and competitiveness dimensions of the Draft Chilean INDC

Abstract details

The economic and competitiveness dimensions of the Draft Chilean INDC

A. Rudnick (1) (1) MAPS Programme, Latin America, Santiago, Chile

Abstract content

Chile’s national contribution to mitigation is based on a commitment to reducing greenhouse gases for the post-2020 period. It is based on the sectorial analyses and the mitigation scenarios developed in 2013-2014 with MAPS Chile (Phase 2), the results of the National Greenhouse Gas Inventory, and additional information provided by the Ministries of Environment, Energy, Agriculture and the Treasury.

Chile aims to reduce its greenhouse gas emissions while decreasing poverty and inequality as well as continue advancing toward sustainable, competitive, inclusive and low-carbon development. To confront these challenges successfully, the country should direct all its efforts to decoupling economic growth from greenhouse gas emissions.

Draft Intended Nationally Determined Contribution on Mitigation

Chile analyzed a subset of three forms of contribution for the whole economy, namely: i) carbon intensity target, ii) a deviation below business as usual scenario specified ex ante, and iii) trajectories. From a review of existing literature and considering the national experience with the Copenhagen pledge, Chile has chosen to report its contribution for the post-2020 period in the form of emissions intensity. Chile’s contribution will allow the country to reach high levels of economy-wide mitigation. Methodologically, it takes two components into account: a) a carbon intensity target, expressed in greenhouse gas emissions per unit of economic development (GDP) which includes all sectors where mitigation is possible in Chile except for forestry; and b) a separate target for forestry. t

The draft INDC was submitted to a national consultation process, were two options of carbon intensity target were consulted.

Option A: Chile is committed to reducing its CO2eq emissions per GDP unit by 30-35% below their 2007 levels by 2025. Chile is also committed to reducing its CO2eq emissions per GDP unit by 40-45% below their 2007 levels by 2030.

Option B: Chile is committed to reducing its CO2eq emissions per GDP unit by 25-30% below their 2007 levels by 2025. Chile is also committed to reducing its CO2eq emissions per GDP unit by 35-40% below their 2007 levels by 2030.

Figure 1:Upper value of Option A expressed in emissions (excluding LULUCF) per unit of GDP

Source: Draft INDC. Government of Chile. 2015.

In addition, for the forestry sector Chile has proposed restoring about 100,000 hectares of degraded land (forestation) with its own resources investing an estimated US$250 million, reaching an area of at least 100,000 hectares of managed native forest by 2035.

National perspective

Chile already has concrete and ambitious goals and policies, and has consistent energy policies to move towards a clean, safe, sustainable matrix (Law on renewable energy, energy efficiency targets, carbon tax). Emission mitigation is seen as an opportunity to low-carbon development with multiple benefits such as job creation, improved population health, competitiveness and others.

The mitigation scenarios considered for the draft INDC were modeled through a dynamic stochastic general equilibrium model (in Phase 2 of MAPS-Chile) for two macroeconomic variables: increase in the value of GDP and increased employment. The values presented in the table below correspond to percentage deviations from the baseline from 2013 to 2030. The three scenarios represent the mitigation range included in Option A and Option B of the draft INDC.

Table 1: Macro economic effects of mitigation options

Scenario

GDP

Employment

CO2eq Emissions

2030

2030

2030

80/20 (Lower value of Option B)

1,2%

0,0%

-18,8%

Medio (Upper value of Option B and lower value of Option A)

6,7%

5,5%

-23,4%

Alto (Upper value of Option A)

7,4%

6,3%

-26,2%

Source: MAPS Chile results (Phase 2).

According to the GDP growth rate, the population projections, and the mitigation measures and policy choices considered in the three mitigation scenarios, the macroeconomic modeling results indicate that high mitigation scenario is not only the most ambitious in terms of emission reduction, but also verifies the largest increases in GDP and employment levels to 2030.